Study Says States Lose Billions in Offshore Tax Avoidance
Source: Bloomberg
By Richard Rubin - Feb 5, 2013 10:58 AM ET
State governments in the U.S. lost $39.8 billion in 2011 because of offshore tax avoidance, according to a study released today.
About two-thirds of the lost revenue is from corporations, which can shift profits to low-tax jurisdictions outside the U.S. and avoid paying taxes until they bring the money home. The report was issued by the U.S. Public Interest Research Group, a Washington-based consumer group that often opposes banks and insurance companies.
The report shows that states, like the federal government, are harmed by “tax trickery” of multinational corporations, said Representative Lloyd Doggett, a Texas Democrat on the tax- writing House Ways and Means Committee.
“We have the means with which to close these loopholes,” he said on a conference call with reporters timed to the report’s release. “What we now need is the will.”
Read more: http://www.bloomberg.com/news/2013-02-05/study-says-states-lose-billions-in-offshore-tax-avoidance.html
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MynameisBlarney
(2,979 posts)the 1%'ers.
They don't care about such mundane things like the well being of the country they live in, or the plight of those less fortunate.
valerief
(53,235 posts)MynameisBlarney
(2,979 posts)We should all be thankful to pay more in taxes so the filthy rich can become even richer.
It's what the Founding Fathers wanted.
valerief
(53,235 posts)or for the benefit of their loved ones but for the benefit of the very wealthy. Over and over and over again.
Amazing.
MynameisBlarney
(2,979 posts)not only have you amassed obscene amounts of personal wealth, but you can also convince poor people to die so you can keep it.
Blanks
(4,835 posts)I believe that was what he claimed was going to stimulate the economy (without him actually having to do anything).
Just let the wealthy bring that money home without having to pay any taxes on it, and there'll be lots of car elevator construction jobs all over the economy.
Or something like that. It seems like that was one of his points from his despicable 47% speech. It was part of his 52 point plan (or however many points there were).
mopinko
(70,127 posts)if we did something about this shit, it would help down to the local level.
make these f'ers pay their fair share.
bigapple1963
(111 posts)between offshore tax avoidance schemes and say mortgage interest deductions (for personal income tax)?
Both are perfectly legal and both reduce the amount of taxes paid.
If anything, a company has a fiduciary duty to its shareholders to reduce the amount of taxes paid.
valerief
(53,235 posts)pay more income taxes than you have to?
Donate any refunds back to the IRS?
athena
(4,187 posts)There is a difference between a tax loophole and a tax deduction.
The mortgage deduction is supposed to provide an incentive for people to buy a house. Buying a house stimulates the economy by providing demand for construction. Fewer people would buy a house if it weren't for the mortgage deduction.
Please explain to me how offshore tax avoidance stimulates the economy.
Oh, I suppose you'll say the rich get to keep more of their money, so that some of their wealth will eventually trickle down to the rest of us. Well, would it not be better if that "wealth," which seems to take an awfully long time to trickle down, would go toward building roads and bridges and improving the education system?
I'm sorry, but you are only fooling yourself if you think that taking advantage of a tax loophole is one's patriotic responsibility.
athena
(4,187 posts)I've thought about it some more. Taking advantage of a tax loophole is like finding a wallet on the ground and not returning it to the owner even though the owner's contact information is in the wallet. Taking a tax deduction is like returning the wallet to the owner and accepting a small reward for your good deed.
What you're saying is that anyone who criticizes someone for keeping the wallet should be criticized for being willing to accept the reward.
ETA: Another analogy would be the following. You're checking out at the store and notice that a register is unattended. So you take some of the store's money and walk out. Is that really the same as using a coupon offered by the store for a discount? A loophole is by definition unintentional. Taking advantage of it is no better than stealing.
bigapple1963
(111 posts)both your examples are plain illegal (not returning wallet/shoplifting).
As for whether one has the patriotic duty to pay more taxes than legally required, a judge has ruled on this:
"Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one’s taxes. Over and over again the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike and all do right, for nobody owes and public duty to pay more than the law demands."
Do you pay extra taxes to the US Treasury? You can easily make a donation.
busterbrown
(8,515 posts)That leaves Rand...... Are you going to be around for awhile?
athena
(4,187 posts)The argument you made was that using offshore havens to avoid paying taxes is no worse than taking a mortgage deduction.
Now you're claiming that anyone who criticizes those using offshore havens should first show that they pay extra money to the U.S. treasury.
Taking advantage of an accidental "loophole" is in no way similar to taking advantage of an intentional "incentive". The legality of loopholes is irrelevant to this discussion. Not everything that is wrong is illegal. And not everything that is legal is right. Discriminating against people based on their weight, for example, may not be illegal, but that doesn't mean it's acceptable.
Where your argument falls apart, actually, is when you claim everybody does it. In fact, the loopholes available for wealthy people and corporations are simply not available to regular people. Read "Perfectly Legal" by David Cay Johnston to learn more.
http://socialistworker.org/2012/02/24/perfectly-legal
http://wweek.com/portland/article-17350-9_things_the_rich_dont_want_you_to_know_about_taxes.html
FYI, I am already paying for wealthy people and corporations to offshore their money, as is every other U.S. taxpayer on this forum:
http://www.uspirg.org/reports/usp/tax-shell-game-how-much-did-offshore-tax-havens-cost-you-2010
bigapple1963
(111 posts)which I haven't changed, is that both are legal and that no one/corporations has any obligation to pay more taxes than legally required.
If you disagree on the second premise, then do you think that people/corporations should consider the intent of Congress as well as the economic benefits of any tax reduction schemes they employ (including deductions)?
athena
(4,187 posts)Incorporating your corporation in a tax haven country to reduce your taxes is not legal. To use this tax evasion trick, you have to be able to claim that there is a legitimate reason for your company to be in that country. The reason cannot be tax evasion.
bigapple1963
(111 posts)are perfectly legal e.g. Double Irish, Dutch sandwich.
I asked whether you paid more income taxes than you legally had to, not whether you are paying more as a result of legal loopholes taken by corporations. For example, other tax payers (renters) pay more in taxes because of the mortgage interest deductions.
athena
(4,187 posts)It just wasn't a good point. You're saying that anyone who is against corporations using tax loopholes should demonstrate their sincerity by paying more than they owe. That is a non-sequitur. A more logical argument would be that anyone who is against corporations using tax loopholes should not be using tax loopholes themselves. I don't take advantage of any tax loopholes. Indeed, most tax loopholes are not available to regular people like myself. For example, it is not legal for individuals to hide money in offshore accounts. It is only legal if you're a corporation in a tax-haven country and can credibly claim that you are not in that tax haven to evade taxes but for other reasons.
It is, on the other hand, a much more interesting point to note that the regular taxpayer pays a significant amount for the costs of large corporations using offshore tax havens to evade taxes.
is the distinction then between loopholes and deductions? You have argued congressional intent and economic impact. Should taxpayers be in the position of having to figure out the intent/economic impact behind every tax deduction they take? Or should they just take what is available at face value and leave it to Congress to close the loopholes?
I can also argue that the regular taxpayers pay a significant amount for any group of people with special treatment in the tax code e.g. offshore havens, EIC, couples filing jointly, mortgage deductions, etc. Why then would you single out one particular group and say you are paying more because of that group?
marions ghost
(19,841 posts)--especially when you have Rethuglicons making laws.
Laws can be changed --to reflect the will of the majority, not the 1%. "Keep taxes as low as possible" does not and should not mean "pay no taxes."
There is nothing that is more immoral than offshoring money made by US companies in order to avoid taxes.
busterbrown
(8,515 posts)Oh thats right, Corporations are now people.
AllyCat
(16,189 posts)Because spurring the economy by putting money in people's pockets to help offset the cost of a home ON US SOIL is vastly different than putting money in offshore accounts where only the rich crook who lays claim to it gets to use it...except they don't use it. Not here anyway. And certainly not to create any jobs.
busterbrown
(8,515 posts)Get it!!!! Its about supporting the middle class, which obviously you don’t.. Welcome to our world...
Turbineguy
(37,343 posts)People using loopholes to not pay taxes.
AllyCat
(16,189 posts)Isn't this just common sense?
